Travel + Leisure Co (TNL)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 167,000 | 282,000 | 550,000 | 369,000 | 1,196,000 |
| Short-term investments | US$ in thousands | 18,000 | 19,000 | 18,000 | 21,000 | 26,000 |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 524,000 | 1,168,000 | 1,136,000 | 1,159,000 | 715,000 |
| Quick ratio | 0.35 | 0.26 | 0.50 | 0.34 | 1.71 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($167,000K
+ $18,000K
+ $—K)
÷ $524,000K
= 0.35
The quick ratio of Travel + Leisure Co has shown fluctuations over the years based on the provided data. As of December 31, 2020, the quick ratio stood at a healthy level of 1.71, indicating that the company had a strong ability to meet its short-term obligations using its most liquid assets.
However, by December 31, 2021, the quick ratio decreased significantly to 0.34, suggesting a potential liquidity issue as the company may struggle to cover its short-term liabilities with its current liquid assets alone.
The quick ratio improved slightly by December 31, 2022, reaching 0.50, but still remained below the ideal ratio of 1. This indicates that the company may still have challenges in meeting its immediate financial obligations without relying on additional sources of liquidity.
Subsequently, the quick ratio deteriorated further to 0.26 as of December 31, 2023, signaling a continued strain on the company's ability to cover its short-term liabilities with its liquid assets.
As of December 31, 2024, the quick ratio improved marginally to 0.35, although it remains below the industry benchmark. This suggests that Travel + Leisure Co may need to closely monitor its liquidity position and possibly take steps to improve its short-term financial health.
In conclusion, the declining trend in Travel + Leisure Co's quick ratio over the years highlights potential liquidity challenges that the company may be facing, emphasizing the importance of managing its short-term obligations effectively to maintain financial stability.
Peer comparison
Dec 31, 2024